JAMS Arbitration

Tauler Smith Investigating Claims Against JAMS

JAMS Arbitration

The California business fraud lawyers at Tauler Smith LLP are investigating claims against JAMS after concerns were raised about the arbitration company’s relationship with WeWork. In WeWork arbitrations administered by JAMS, prior case results were known only by JAMS and WeWork. These case results were never shared with WeWork’s opponents, who are mostly small businesses. Neither WeWork nor JAMS would seem to have an interest in sharing information with WeWork’s opponents because doing so could lead to less fees for JAMS. It is wrong for JAMS to operate so obliquely. As an administrator of justice, they need to be held to a higher standard.

To learn more about the claims against JAMS, keep reading this blog.

WeWork Uses JAMS Arbitration Services

JAMS is the world’s largest private provider of Alternative Dispute Resolution (ADR) services. As the name suggests, Alternative Dispute Resolution is an alternative to traditional litigation that allows parties to resolve their legal dispute without needing to go to court for a trial. Sometimes, a contract will require two parties to use ADR services, which is what happens in the standard WeWork contract: the small business owners who sign a lease with WeWork have no choice but to use mandatory arbitration if a dispute arises, and the parties are bound by the decision of the JAMS arbitrator. JAMS also sets the rules and procedures for these arbitrations.

JAMS arbitrates cases in several practice areas, including civil rights, class actions, intellectual property, personal injury, product liability, and real estate. One of JAMS’ biggest clients appears to be WeWork, which uses JAMS to administer arbitrations anytime a dispute arises with one of WeWork’s tenants. When a small business owner signs a lease agreement with WeWork, it typically includes a pre-dispute contract that requires the parties to use arbitration if a dispute arises. The effect of these forced arbitration clauses in WeWork contracts is to have the parties waive their right to a jury trial. A WeWork contract typically stipulates that the arbitration will be administered by JAMS, and the decisions rendered by JAMS arbitrators are final and legally binding on the parties.

JAMS Won’t Disclose Data About Arbitrations Involving WeWork

Does JAMS have a conflict of interest in WeWork arbitrations? JAMS touts its ability to resolve legal and business disputes with “impartial” dispute resolution services administered by “neutral” arbitrators and mediators. The former legal professionals who administer JAMS arbitrations are known as “JAMS Neutrals.” As their title indicates, these individuals are supposed to provide fair, unbiased decisions. But there are questions about JAMS’ relationship with its biggest client – WeWork – and this has raised concerns about the fairness and impartiality of the JAMS arbitrators in these cases.

Significantly, JAMS refuses to disclose information that might show they are colluding with WeWork in arbitration. Law firm Tauler Smith LLP recently requested disclosures from JAMS about WeWork and WeWork affiliates. JAMS responded by refusing to provide the requested information because it supposedly “goes beyond legal and ethical disclosure requirements for arbitrators and would violate JAMS confidentiality obligations to other litigants.”

Thus far, JAMS has only provided data about the number of arbitrations with respect to one WeWork company: the one with a listed address of 500 7th Avenue in New Yok. JAMS did not provide any disclosures about the other 36 WeWork entities. Moreover, even the information in the JAMS disclosure about the single WeWork address is limited becuase it simply states that the 500 7th Ave. tenant has 35 pending arbitrations with JAMS and 17 pending mediations. As such, JAMS failed to address the problem identified by the business fraud lawyers at Tauler Smith LLP: that WeWork could have an unfair advantage in any JAMS-administered dispute. If JAMS administers 1,000 cases in which WeWork is one of the parties, and WeWork has won all 1,000 of these cases, why wouldn’t JAMS tell the parties about this?

Why Is JAMS Sharing Relevant Case Information Only with WeWork?

JAMS has refused to share relevant case information with WeWork’s opponents in arbitration due to what JAMS claims is a confidentiality requirement. But JAMS is allowing this information to be shared with WeWork affiliates. This has created an information imbalance that severely disadvantages the small business owners being sued by WeWork. While JAMS declines to provide specific case information to the other parties in these claims, the fact is that WeWork already has access to this information and can share with its affiliates that are involved in other disputes administered by JAMS. This means that only one side of the dispute – and not the other side – can share information with itself, know the outcomes of other cases, and share information with its affiliates. This results in an unfair advantage for WeWork in any arbitration overseen by JAMS.

If WeWork and its affiliates (i.e., WeWork shell entities) account for a significant number of JAMS cases administered in the New York market, it could be evidence of many incentives that are created by JAMS’ administration of WeWork disputes. For example, JAMS would have an incentive to litigate all WeWork cases separately so that only WeWork (and JAMS) has relevant information about outcomes. If WeWork knows that arbitrators are ruling in WeWork’s favor 100% of the time and awarding attorney’s fees every single time based on an identical contract, WeWork’s legal counsel could overbill, constantly brief unnecessary issues, file pre-trial briefs, and file post-trial briefs knowing that these requests will be granted. Further, the small business owner respondents in these cases will not have access to this information because they are not allowed to see it.

Antitrust Concerns Over JAMS’ Relationship with WeWork

JAMS has an effective monopoly over these types of cases. And they may use that privilege unfairly. This could raise concerns about JAMS violating federal antitrust laws like the Sherman Act because WeWork appears to be getting preferential treatment from JAMS. The fact is that WeWork and its affiliates are repeat customers of JAMS, not the small businesses that are typically on the other side of a dispute with WeWork.

The actions taken by JAMS with respect to its relationship with WeWork do not appear to be a fair or reasonable way to administer justice. Any system of justice should treat litigants equally. In the complaint being prepared against JAMS, the California business fraud attorneys at Tauler Smith LLP allege that their clients’ due process rights have been violated because it would be manifestly unjust to collect arbitration fees from thousands of small businesses and force them to go to a hearing to defend themselves when the end result is already known to the other party in advance.

Contact the California Business Fraud Lawyers at Tauler Smith LLP

If you are a small business owner who has been forced to go into an arbitration administered by JAMS, you should speak with an experienced California business fraud lawyer immediately. The Tauler Smith LLP legal team includes attorneys who have extensive experience with professional negotiation, mediation, and alternative dispute resolution. Call or email us to schedule a free consultation about your case.

TruConnect Summary Judgment

Firm Wins Summary Judgment in Qui Tam Employment Claim

TruConnect Summary Judgment

The California employment defense attorneys at Tauler Smith LLP recently served as co-counsel with Greenberg Traurig to represent TruConnect in a retaliation and wrongful termination case. The firm secured a decisive victory in the case by persuading a U.S. District Court to grant a motion for summary judgment. This means that the workplace retaliation & wrongful termination claims were thrown out at the summary judgment stage without the need for oral argument.

The court’s decision can be read in its entirety here. To learn more about Tauler Smith’s victory in the qui tam employment claim, keep reading this blog.

Los Angeles Employment Attorney Robert Tauler Serves as Co-Counsel for TruConnect

TruConnect Communications, Inc. is a wireless and telecommunications company that provides cell phone service and mobile data plans in the United States, including a partnership with the federal government on the Lifeline Program that subsidizes low-income families with free wireless service. Los Angeles employment attorney Robert Tauler of Tauler Smith LLP worked with the lawyers at Greenberg Traurig to represent TruConnect at several different stages of a qui tam employment retaliation action.

The legal action began when two former employees of Sage Telecom, Inc. filed a qui tam whistleblower claim with the federal government after their positions at the company were eliminated due to significant market contractions. Attorney Robert Tauler was initially hired to defend two of TruConnect’s individual CEOs against the ex-employees’ allegations of qui tam whistleblower retaliation, and he successfully got that part of the case dismissed within a few months. Mr. Tauler was subsequently brought on as co-counsel in the larger employment action involving TruConnect, and now that case has also concluded with Mr. Tauler helping to win a court ruling on behalf of the telecom company.

District Court Grants Motion for Summary Judgment in California False Claims Act Case

The employment retaliation case was heard in the United States District Court for the Central District of California. Despite having already lost their qui tam whistleblower claim involving TruConnect, the former employees still argued that they were entitled to damages for retaliation and wrongful termination. These claims were filed under three statutes:

  1. False Claims Act (alleging retaliation)
  2. California False Claims Act (alleging retaliation)
  3. California Labor Code (alleging wrongful termination)

On June 21, 2022, U.S. District Court Judge Philip S. Gutierrez granted a motion for summary judgment that effectively ended the case by dismissing all of the plaintiffs’ claims of retaliation and wrongful termination. The court stated that TruConnect was entitled to judgment “as a matter of law,” which meant that there was no need to proceed to trial.

Los Angeles Litigator Robert Tauler Wins Cases for Clients in California State and Federal Courts

The TruConnect qui tam retaliation case represents another huge victory for Tauler Smith LLP. Attorney Robert Tauler and the other skilled members of the firm’s litigation team have earned the respect of their peers in the legal community, including judges, opposing attorneys, and legal experts. Whether it’s an employment matter, an intellectual property claim, or a business dispute, our lawyers always prepare every case with the expectation that it will go to trial. This gives us a significant advantage during the pre-trial stages, and it puts our clients in the best possible position to win.

Contact the California Employment Defense Attorneys at Tauler Smith LLP

The attorneys at Tauler Smith LLP have extensive experience handling California employment claims. We represent both plaintiffs and defendants, and our litigators know how to file successful motions for summary judgment in federal and state courts. If you are involved in litigation, the Tauler Smith LLP legal team can help you. Call 310-590-3927 or fill out the online contact form to schedule a free consultation.

WeWork Arbitration

Tauler Smith Investigating Claims Against WeWork

WeWork Arbitration

Law firm Tauler Smith LLP is investigating claims against WeWork and JAMS over misconduct in hundreds of arbitrations initiated by WeWork against small businesses. The unprecedented number of arbitrations (enforcing identical “membership agreements” for “services” despite business closures stemming from COVID-19) generates massive revenue and incentives for JAMS, creating a conflict of interest that is not disclosed to small businesses being pursued by WeWork through JAMS. Neither JAMS nor WeWork discloses to any of these small businesses the nature of the parties’ pecuniary relationship, such as the amount WeWork pays to JAMS every year. Beyond that, neither JAMS nor WeWork discloses prior case outcomes to the small businesses pursued by WeWork, even though WeWork uses identical contracts and identical legal theories in these cases.

Only WeWork and JAMS know case outcomes, but small business opponents defending claims brought by WeWork do not. This places WeWork at a massive advantage since only they have access to certain information, including how JAMS has interpreted the identical contract on multiple occasions. The result is a process that is unfair to small business defendants. It is a process that benefits only WeWork and JAMS by perpetuating WeWork’s ability to pursue its members and by giving JAMS the continued ability to collect fees from hundreds of disputes.

To learn more about the possible legal claims against WeWork and JAMS, keep reading this blog.

WeWork Sued Small Business Owners for Rent During COVID Pandemic

WeWork is a company that provides coworking spaces to businesses. WeWork uses an identical “Membership Agreement,” but not as a lease of space; rather, it is for the provision of services. This allows WeWork to argue that legal protections ordinarily afforded to tenants do not apply to WeWork members. WeWork then argues that landlord-tenant law is applicable to obtain favorable rulings from JAMS.

The attorneys at Tauler Smith LLP are also investigating whether WeWork is reporting the revenue in Membership Agreements accurately to the U.S. Securities and Exchange Commission (SEC). WeWork’s accounting procedures have come under public scrutiny over the last several years. The COVID-19 pandemic and the arbitrations WeWork initiated with JAMS potentially provide a means for WeWork to double-book revenue if they apply deceptive accounting methods.

Tauler Smith LLP is also investigating whether WeWork uses private arbitration to protect itself from revealing misconduct that is of concern to the public. Since WeWork structures all of its contracts to be private, only WeWork and JAMS know how and why JAMS has been ruling favorably for WeWork. Moreover, since the cases go through arbitration instead of going through the courts, the small businesses do not know the prior results. This puts the small businesses at an even greater disadvantage in the proceedings. Arbitration is often used for business conflicts that involve contract disputes. WeWork requires anyone who signs a lease with the company to agree in advance to use arbitration for any legal disputes. Even being a part of an arbitration can cost a small businesses significant money. WeWork arbitrations are administered by JAMS, an arbitration company that also provides mediation and Alternative Dispute Resolution (ADR) services.

Tauler Smith LLP Investigates Relationship Between WeWork and Arbitration Company JAMS

Tauler Smith LLP is now investigating a possible legal claim against JAMS stemming from the arbitration company’s lucrative and ongoing relationship with WeWork. It has been reported that WeWork may be the largest tenant/landlord in all of New York City, and it is believed that WeWork has pursued hundreds (if not thousands) of claims against its members using only one arbitration company: JAMS. This would mean that JAMS has received millions of dollars from WeWork. JAMS is therefore incentivized to side with WeWork in every case, creating a conflict of interest that is not disclosed. Based on our preliminary investigation, no WeWork member has ever won a JAMS-arbitrated dispute against WeWork. Since WeWork members are never informed of case results – but JAMS and WeWork are privy to this information – WeWork cases submitted to JAMS are inherently unfair.

WeWork uses discrete companies for each of their workplaces to further obfuscate the claims it pursues against its members, as well as the work it gives to JAMS. Tauler Smith LLP has obtained a list of 36 company names and/or addresses for WeWork affiliates that have been involved in arbitrations administered by JAMS:

  • 18691 Jamboree Rd., Irvine, CA 92612
  • 1601 Vine St., Los Angeles, CA 90028
  • 8305 Sunset Blvd., Los Angeles, CA 90069
  • 8687 Melrose Ave., Los Angeles, CA 90069
  • 4041 MacArthur Blvd., Newport Beach, CA 92660
  • 600 B St., San Diego, CA 92101
  • 71 Stevenson St., San Francisco, CA 94105
  • 535 Mission St. 14th Floor, San Francisco, CA 94105
  • 3001 Bishop Dr., San Ramon, CA 94583
  • 255 Giralda Ave. Floor 5, Coral Gables, FL 33134
  • 78 SW 7th St., Miami, FL 33130
  • 765 W. Peachtree St. NW #4, Atlanta, GA 30308
  • 31 St. James Ave. 6th Floor, Boston, MA 02116
  • 200 Portland St., Boston, MA 02114
  • 625 Massachusetts Ave., Cambridge, MA 02139
  • 1330 Lagoon Ave., Minneapolis, MN 55408
  • 10845 Griffith Peak Dr. #2, Las Vegas, NV 89135
  • 12 E. 49th St., New York, NY 10017
  • 115 Broadway, New York, NY 10006
  • 185 Madison Ave., New York, NY 10016
  • 199 Water St., New York, NY 10038
  • 222 Broadway 19th Floor, New York, NY 10038
  • 300 Park Ave. 12th Floor, New York, NY 10022
  • 401 Park Ave. S. 10th Floor, New York, NY 10016
  • 500 7th Ave., New York, NY 10018
  • 524 Broadway, New York, NY 10012
  • 880 3rd Ave., New York, NY 10022
  • 1115 Broadway, New York, NY 10010
  • 1881 Broadway, New York, NY 10023
  • 1201 3rd Ave., Seattle, WA 98101
  • Bastion Collective LLC
  • We Company
  • WeWork
  • WeWork Companies, Inc.
  • WeWork Companies LLC
  • WeWork Management LLC

How Much Money Does JAMS Make from Its Relationship with WeWork?

JAMS has thus far dismissed any concerns about impartiality or failure to disclose in WeWork cases without providing the data requested. A representative for JAMS stated that the company “administers approximately 15,000 cases per year” and “no single party or law firm significantly impacts JAMS’ total revenue.” The millions of dollars flowing to JAMS from WeWork provides a natural incentive for JAMS to continue ruling favorably for WeWork – which is easy because it is the same “Membership Agreement” being interpreted in each arbitration. Moreover, since JAMS and WeWork refuse to share with small business defendants any relevant information about past rulings, the small businesses remain unaware of the full nature of the WeWork-JAMS relationship. The small businesses will then fight the arbitration and pay JAMS even more fees, only to inevitably lose in front of a JAMS-provided arbitrator. There is no reason for JAMS to be fair because it is not in their financial interests.

JAMS would appear to have an incentive to rule in WeWork’s favor not just because of the many disputes they are currently arbitrating, but also because of all the future business that WeWork will continue to send their way. In other words, JAMS may want to keep WeWork happy because JAMS collects fees on every arbitration, and WeWork sends them a lot of business that generates fees.

Contact the California Business Fraud Lawyers at Tauler Smith LLP

Are you a small business owner who is being pursued by WeWork through JAMS? If so, you may have a possible legal claim against both WeWork and JAMS. WeWork uses JAMS to arbitrate legal disputes, and it is believed that WeWork has never lost a JAMS-administered dispute. You can schedule a free consultation with the California business fraud lawyers at Tauler Smith LLP by calling or sending an email.

Anxiety Supplement Lawsuit

Natrol Class Action for Anxiety Supplements

Anxiety Supplement Lawsuit

Tauler Smith LLP, a California law firm focusing on consumer fraud litigation, recently filed a class action complaint against supplement manufacturer Natrol LLC. The Natrol class action for anxiety supplements complaint asserts that Natrol is violating the Consumers Legal Remedies Act (CLRA) by marketing its Relax+ Ultimate Calm supplement as a remedy for anxiety when it contains “ineffectual herbs, extracts, and other vitamins that plainly do not have the ability to treat anxiety.” The nutritional supplement lawsuit also alleges that when an individual uses unapproved anxiety medications like Relax+ Ultimate Calm instead of seeking treatment from a licensed doctor, they could worsen their mental health.

The Los Angeles false advertising lawyers at Tauler Smith LLP are bringing civil actions against companies that market and sell dietary supplements claiming to remedy anxiety. If you purchased one of these supplements, you may be eligible to join a class action lawsuit. Contact us today to discuss your options.

Nutritional Supplement Manufacturers Endanger Consumers with Unapproved Anxiety Drugs

Anxiety is a recognized mental disorder. When a person suffers from anxiety, they may be stricken with feelings of worry or fear while attempting to perform everyday activities. This is a major mental health concern for millions of Americans, with statistics showing that more than 40 million U.S. adults are affected by anxiety disorders. This includes millions of young children and teenagers who struggle with mental health problems.

According to the Mayo Clinic, the best way to treat an anxiety disorder is with medications prescribed by a licensed physician and psychotherapy provided by a mental health counselor. Additionally, the National Institute of Public Health (NIH) has stated that individuals should not self-diagnose or use over-the-counter supplements to treat anxiety. The nutritional supplement industry has attempted to capitalize on the country’s worsening mental health crisis in the aftermath of the COVID-19 pandemic by making unsupported claims regarding the ability of their products to relieve conditions like anxiety. When anxiety is left untreated, it can be ruinous to individuals and lead to more serious conditions and diseases.

Natrol Accused of False Advertising of the Relax+ Ultimate Calm Supplement as a Remedy for Anxiety

Natrol is a U.S. manufacturer of vitamins, minerals, and nutritional supplements. The company’s headquarters are in Chatsworth, California. According to Dun & Bradstreet, Natrol’s annual revenues surpass $121 million, which is part of the $140 billion market for dietary supplements.

The complaint alleges that Natrol puts consumers at risk by advertising its Relax+ Ultimate Calm supplement as a treatment for anxiety. The U.S. Food and Drug Administration (FDA) has issued a warning about the use of unapproved drugs to treat anxiety. Consumers who place their trust in nutritional supplement manufacturers may be more likely to forego seeking medical treatment for their health conditions, which can compound the effects of the disorders. Additionally, these individuals may be more likely to develop other mental and physical conditions because anxiety can cause depression, substance misuse, social isolation, and suicide.

Supplements Claiming to Treat Anxiety Violate the California Consumers Legal Remedies Act

The California Consumers Legal Remedies Act (CLRA) is a consumer protection statute that is meant to safeguard individuals against business fraud, including “unfair methods of competition and unfair or deceptive acts or practices in a transaction.” The CLRA, which is codified in Cal. Civ. Code §§ 1750, makes it illegal for companies to mislead consumers in advertising or sales transactions. The statute explicitly prohibits companies from “representing that goods…have…characteristics, ingredients, uses, benefits, or quantities that they do not have.” Plaintiffs can bring private civil actions under the CLRA when they have been deceived by the acts or practices of a company in the sale of consumer goods such as nutritional or dietary supplements.

Natrol has been accused of making unsupported claims about the ability of its Relax+ Ultimate Calm product to relieve anxiety. On the product packaging, Natrol prominently represents that use of the Relax+ Ultimate Calm supplement will reduce “stress, anxiety & tension” and offer other health benefits. According to the complaint, these representations are untrue and unlawful.

Class Action Lawsuit Filed Against Natrol for Violating the CLRA

The Los Angeles business fraud attorneys at Tauler Smith LLP have brought a class action lawsuit against Natrol for violating the CLRA. The legal complaint was filed in the Los Angeles County Superior Court. The complaint explains that an individual who consumes the Relax+ Ultimate Calm product “in lieu of a professional medical evaluation and treatment” is at risk of exacerbating their anxiety, as well as developing additional mental health disorders. Anyone who purchased the Relax+ Ultimate Calm supplement may be eligible to join the class action.

The class action lawsuit against Natrol seeks relief and judgment that includes the following:

  • An injunction that orders Natrol to correct its alleged deceptive marketing scheme and stop claiming that Relax+ Ultimate Calm is a remedy for anxiety.
  • An award of actual, punitive, and statutory damages to compensate the plaintiffs who purchased Relax+ Ultimate Calm.
  • Reimbursement of attorney’s fees for the plaintiffs.
  • Any other relief that the court may deem just and proper.

Did You Buy a Supplement That Claims to Treat Anxiety? Contact a California Consumer Fraud Lawyer Today

The California consumer fraud attorneys at Tauler Smith LLP are committed to protecting consumers against deceptive business practices. If you purchased a dietary supplement that claims to remedy anxiety, you should contact our legal team today to discuss your eligibility to join a class action lawsuit. Call 310-590-3927 or email us to schedule a free consultation.

Texas Deceptive Trade Practices Act

Texas Deceptive Trade Practices Act

Texas Deceptive Trade Practices Act

Texas has strong consumer protection laws that safeguard residents against scams and other illegal practices. Chief among these laws is the Texas Deceptive Trade Practices Act (DTPA), which gives plaintiffs the ability to recover additional damages when they have been defrauded by false, misleading, or deceptive business practices. When state lawmakers passed the DTPA, the intent behind the bill was that companies should think twice before committing any kind of fraud against consumers. Texas consumer protection lawyers know just how effective the DTPA can be at holding fraudsters accountable for their unethical actions.

To learn more about the Texas Deceptive Trade Practices Act, keep reading this blog.

What Is the Texas Deceptive Trade Practices Act?

The Texas Deceptive Trade Practices Act, or DTPA, is a consumer protection law that prohibits businesses from making false or misleading statements in advertisements, contracts, and any transactions involving consumers. The DTPA gives consumers a cause of action for a civil suit when they have been misled by a business. The text of the statute casts a wide net by explicitly forbidding businesses from knowingly deceiving customers in advertisements, marketing materials, and sales transactions. This includes “false, misleading, and deceptive business practices, unconscionable actions, and breaches of warranty.”

The DTPA applies to several different types of consumer transactions, including the sale or lease of commercial goods, products, services, or property. The Texas DTPA law has a lengthy list of examples of deceptive business acts, including the following:

  • Passing off goods or services as those of another.
  • Confusing consumers about the true source of goods or services.
  • Lying about the certification status of a product or service.
  • Misrepresenting whether a product or service has received sponsorship or approval.
  • Lying about the geographic origin of goods or services.
  • Misrepresenting the ingredients of goods such as food products or nutritional supplements.
  • Selling an item as “new” when the product is used or reconditioned.
  • Lying about the quality or grade of a product.
  • Using misleading statements to disparage a competitor’s goods or services.
  • Advertising items as available for sale when they are unavailable or there is only a limited supply.
  • Lying about the reasons for a price reduction.
  • Misrepresenting the need for additional parts, replacement, or repairs.
  • Falsely presenting a salesperson as having the authority to negotiate final terms of a transaction.
  • Secretly resetting the odometer on a motor vehicle for sale.
  • Lying about a “going out of business” sale when the store is not going out of business.
  • Using “corporation” or “incorporated” in the name of a business when it has not been incorporated.
  • Falsely representing that a solicitation has been sent on behalf of a governmental entity.
  • Price gouging during a natural disaster.

Additional Damages Available Under the DTPA

The damages and compensation that may be available to plaintiffs filing lawsuits under the Texas Deceptive Trade Practices Act include actual damages (i.e., economic damages), mental anguish damages, and attorney’s fees. The actual damages could involve things like the money spent on the purchase, as well as repair or replacement costs after the transaction.

Additionally, when a plaintiff in a DTPA case wins their claim, they may be eligible for up to three (3) times the usual damages awarded in a Texas civil suit.

Mental Anguish Damages

If the judge or jury finds that the defendant knowingly deceived the plaintiff, then it may be possible for the plaintiff to receive an award for mental anguish damages. The ability to recover damages for mental anguish is unique in DTPA claims because business transactions typically don’t involve the same kinds of mental or emotional harms as personal injury and wrongful death claims.

Treble Damages

The DTPA also allows for the recovery of treble damages, which means that the judge may impose a multiplier on the judgment or ruling and award up to three times the damages amount. When a defendant’s conduct is deemed egregious, it is not uncommon for plaintiffs to be awarded significantly higher damages as a way of sending a message and discouraging unethical behavior by other businesses in the future.

DTPA Waiting Period & Deadlines

Texas law requires victims of business fraud to wait at least 60 days before filing a DTPA lawsuit. The statute specifically requires plaintiffs to send a demand letter to the business owner or individual so that they have an opportunity to address the alleged fraud and potentially resolve the matter before a legal claim is necessary. Once 60 days have passed since the demand letter was sent to the defendant, then the plaintiff may choose to formally file their lawsuit in a Texas court.

Just as there is a waiting period on the front end of any DTPA claim, there is also a time limit for the plaintiff to take legal action. The deadline for a consumer to file a DTPA lawsuit is two (2) years from the date on which the false or deceptive business practice occurred. This statute of limitations is half the time that a plaintiff typically has available to file a breach of contract lawsuit in Texas.

Contact the Texas Consumer Fraud Lawyers at Tauler Smith LLP

The Deceptive Trade Practices Act (DTPA) gives Texas consumers the right to file a lawsuit and pursue damages when they have been victimized by a scammer or fraudulent business. If you have been misled or deceived in a commercial transaction, the Texas consumer fraud attorneys at Tauler Smith LLP can help you file a DTPA claim. Call or email us today to go over your options.

NFT Copyright Law

Copyright Law & NFTs

NFT Copyright Law

The explosion of Bitcoin and other cryptocurrencies has led to interest in related digital assets. Among the most popular – and volatile – of those digital assets are Non-Fungible Tokens, or NFTs. As more and more investors consider NFTs, questions are being asked about the legality of this technology. Specifically, people want to know about copyright law & NFTs. Is it possible to hold a copyright for an NFT? Are you allowed to create derivative copies of your NFT and reproduce it? If an NFT was created from an original work, what are the copyright implications for that original work? This is a murky area of the law that is still developing, and it has implications for a lot of people: NFT buyers, NFT sellers, and pretty much anyone who owns a copyright.

To learn more about NFTs and copyright law, keep reading this blog.

What Are NFTs?

On a superficial level, Non-Fungible Tokens (NFTs) are just digital works of art. Some of the most well-known NFTs are digital copies of original works that exist in the real world, such as paintings, music, collectibles, and even tweets. Other NFTs were created exclusively as digital artworks.

Of course, NFTs are significant for reasons that go beyond art appreciation. NFTs are non-traditional assets with a unique quality to them: they are not interchangeable and cannot be divided. By contrast, a Fungible Token like Bitcoin can be broken down into fractional values, so that the owner of a Bitcoin can sell 50% of it and keep the other 50%. The uniqueness of each NFT is what generates a great deal of interest in them, since they are perceived to be incredibly scarce.

Another interesting aspect of NFTs is that they exist entirely on something known as the blockchain, which is a kind of technology that allows information to be permanently stored on a computer network. When someone purchases an NFT, they are purchasing a link to the Token on the blockchain. NFTs essentially function as certificates of ownership. Importantly, the Tokens are entirely digital, with the transaction records traceable online. In one sense, this makes NFTs similar to both real property and intellectual property in that their ownership history is recorded. Additionally, NFTs and Bitcoin are assets that can be traded on certain digital platforms.

Is an NFT Copyright Protected?

NFTs have been in the news lately because the cryptocurrency market has seen sharp declines in value, with many observers wondering if the bottom has fallen out on the NFT market as well. The fact remains, however, that NFTs still have a great deal of value, especially as some owners look to sell their digital assets. This makes it vital to understand how copyright law might impact NFT owners.

First, anyone who buys an NFT should understand that the sale typically does not involve the copyright for the original work that exists outside the blockchain. That’s because an NFT is a derivate of that real-world work, even if the NFT itself is unique. As set forth by the Copyright Act of 1976, only the copyright holder has the right to reproduce the work, distribute copies of the work, and publicly display or perform the work for commercial benefit. The bottom line is that when you buy an NFT, you don’t own it. You cannot create derivative works and sell copies because doing so will impact the intellectual property rights of the person or entity who holds the copyright to the original work.

Given that many NFTs are based on original works, there is also some question about copyright enforcement. Since only the copyright holder has the authority to use their original work commercially, and since NFTs are by definition “reproductions” made for commercial purposes, the NFT market has created a need for copyright holders to monitor social media platforms, websites, message boards, and other areas of the internet for copyright violations. In some instances, NFT copyright violations are so flagrant that it may be necessary to speak with an attorney about sending a copyright demand letter or DMCA notice to the offending party.

Contact the California Copyright Lawyers at Tauler Smith LLP

If you are an artist, business owner, website operator, or other individual whose copyright has been infringed, the Los Angeles copyright lawyers at Tauler Smith LLP can help you. Our legal team understands federal intellectual property law, and we know how to win these types of disputes. Call 310-590-3927 or submit an online contact form to schedule a free consultation.

CLRA Consumer Protection

What Is the Consumers Legal Remedies Act?

CLRA Consumer Protection

California consumer fraud lawyers know that the state has been at the forefront of the consumer rights movement for a long time. In 1970, the California State Legislature passed the Consumers Legal Remedies Act (CLRA) to safeguard customers against deception by businesses. The CLRA makes it unlawful to engage in unfair or misleading acts when selling goods or services to consumers. The CLRA is often applicable in cases involving false advertising claims and/or consumer fraud. For example, when a company uses a misleading advertisement to persuade someone to purchase a product or service, the misrepresentation may constitute a violation of the statute. The same is true when a deceptive or intentionally confusing ad causes a customer to trigger an automatic renewal policy.

To learn more about the Consumers Legal Remedies Act, keep reading this blog.

What Deceptive Business Practices Does the CLRA Prohibit?

The California Consumers Legal Remedies Act, or CLRA, is a consumer statute that’s codified in Cal. Civil Code §§ 1750. The law allows plaintiffs to bring private civil actions against companies that use “unfair methods of competition and unfair or deceptive acts or practices in a transaction.”

The CLRA explicitly prohibits certain deceptive business practices, including the following acts:

  • Selling counterfeit goods.
  • Misrepresenting the source of a good or service.
  • Lying about a professional affiliation, certification, or endorsement.
  • Lying about the geographic origin of a product.
  • Selling a used or reconditioned item as new.
  • Misrepresenting the quality of a good or service.
  • Making false statements that disparage another business’ products.
  • Advertising items as being available for sale when they won’t be.
  • Advertising furniture as available for sale without disclosing that it is unassembled.
  • Telling a customer that a repair or replacement is necessary when it isn’t.
  • Offering a rebate or discount with hidden conditions.
  • Falsely presenting a salesperson’s authority to negotiate and finalize a transaction.
  • “Robo-calling” individuals who are not already customers.

One of the advantages of the CLRA is that victims of business fraud in California are not limited to filing lawsuits under the statute. This means that a consumer could bring multiple claims citing both the CLRA and other state or federal laws.

What Remedies Are Available to California Consumers in CLRA Cases?

The CLRA gives California consumers a powerful tool to hold businesses accountable for deceptive practices because the statute allows plaintiffs to recover different kinds of damages. The law is often interpreted broadly by courts to provide strong protections against consumer fraud, false advertising, and unfair business practices. When a consumer has been defrauded, they can file a lawsuit in a California Superior Court.

Consumers who bring a claim under the CLRA may pursue several remedies for any harm they suffered, including:

  • Actual monetary damages.
  • Punitive damages.
  • Restitution of property to the plaintiff.
  • An injunction against the defendant.
  • Attorney’s fees and court costs.
  • Any other relief the court deems proper.

Actual Damages & Attorney’s Fees

The first remedy available under the CLRA – actual damages – has a statutory minimum of $1,000 for each deceptive act or practice. The last remedy – “any other relief the court deems proper” – is a catch-all provision that gives courts wide latitude when determining what kind of monetary relief should be available to plaintiffs in CLRA actions.

In addition to getting damages for fraud, a plaintiff filing a claim under the CLRA may also be able to get attorney’s fees from a defendant who is found to have violated the Act. This can make it financially feasible for a plaintiff to bring a CLRA claim – since the defendant would have to pay the legal costs for both sides if they lose the case.

Additional Damages for Senior Citizens & Disabled Persons

A couple of special categories of consumers may be eligible for additional damages: senior citizens and disabled persons. As set forth by the CLRA, a “senior citizen” is defined as anyone over the age of 65. (In California, a senior citizen is usually defined as anyone over the age of 62, with the age threshold being lowered to 55 years old when the person lives in a senior citizen housing development.) California law defines “disabled person” quite broadly to include just about anyone who has a physical or mental condition that substantially limits at least one major life activity. For both seniors and disabled persons, the CLRA allows an award of up to $5,000 in damages to be tacked on by the court.

Proving a CLRA Violation

Although the Consumers Legal Remedies Act gives plaintiffs many options when seeking damages for consumer fraud, there are still ways for defendants to avoid paying maximum compensation. For example, if the defendant did not intentionally violate the CLRA, and they subsequently made a good faith attempt to correct the mistake, then the court might not award damages to the plaintiff. The complexities of the statute are one reason why it’s so important for you to have a knowledgeable California business fraud attorney handling your case.

Who Is Allowed to Bring a Lawsuit Under the Consumers Legal Remedies Act?

Private Civil Actions & Class Actions

The CLRA may serve as the basis for a civil suit in any consumer transaction where goods changed hands or services were provided. Anyone who can show damages having been caused by one of the acts prohibited by the CLRA can file a lawsuit, either individually by the consumer or in a class action involving other consumers who were deceived or defrauded. For class action litigation, the cases must be substantially similar. An experienced California consumer protection lawyer can assist you with a CLRA class action lawsuit and help get your class certified.

Exclusions from the CLRA

Certain types of transactions and business owners are excluded from the Consumers Legal Remedies Act: (1) real estate transactions, and (2) newspapers and other advertisers. Although the CLRA applies to most commercial transactions, the statute cannot be used as the basis for a legal claim when the transaction involved the sale of either a residential property or a commercial property. Additionally, the CLRA cannot be used to bring a lawsuit against the owner of a newspaper, magazine, radio station, or any other advertising medium unless the plaintiff can prove that the business owner knew that the ads were deceptive before disseminating them.

How Long Do You Have to Bring a CLRA Claim?

Three-Year Statute of Limitations

It is important for you to speak with a qualified CLRA attorney as soon as possible because you do not want the statute of limitations to expire before you attempt to bring a claim. The general rule is that a consumer has three (3) years from the date on which the unfair business practice occurred to file a lawsuit under the Consumers Legal Remedies Act. If you miss this deadline, you may be barred from bringing a legal action.

Business Owner’s Opportunity to Cure

In addition to making sure you file within the statute of limitations, an experienced attorney can also ensure that you meet any other important deadlines and filing requirements. For example, before the CLRA suit can proceed in court, the consumer must notify the defendant in writing about the alleged violation. This must happen at least 30 days before the lawsuit is filed, and the business owner will then have an opportunity to take appropriate action to fix or otherwise “cure” the harm. (E.g., repairing or replacing a damaged item that was sold to the consumer.)

Contact the California CLRA Lawyers at Tauler Smith LLP

Tauler Smith LLP is a Los Angeles law firm that focuses on consumer fraud litigation. Our attorneys are extremely familiar with the Consumers Legal Remedies Act, and we have filed both private civil actions and class action lawsuits on behalf of consumers. If you were a victim of business fraud or false advertising in California, we can help you take legal action and get you the financial compensation to which you are entitled. Call or email us to discuss your eligibility to file a CLRA claim.

OnlyFans Models Sue Unruly Agency

OnlyFans Models Sue Unruly Agency for Exploitation

OnlyFans Models Sue Unruly Agency

Two more OnlyFans models are suing Unruly Agency for exploitation. On the heels of Tauler Smith LLP lawsuits against Unruly Agency on behalf of exploited social media influencers, two more OnlyFans models have come forward with their own allegations of wildly improper and abusive conduct by Unruly. The models said that the big-name marketing agency has engaged in exploitative conduct that included pressuring them to pose for sexually explicit photos, posting nude images on their OnlyFans accounts without permission, and issuing threats when they attempted to exit their contracts.

To learn more about the shocking new allegations against Unruly Agency for exploiting influencers, keep reading.

Rolling Stone: Fitness Model Sarah Stage Sues Unruly Agency for Sexual Exploitation & Threats

Unruly Agency is one of the largest and most well-known agencies for social media influencers. The agency, which was founded by Tara “Elektra” Niknejad and Nicky Gathrite, represents clients that include Tana Mongeau and Harry Jowsey. With the recent surge in popularity for the OnlyFans platform, Unruly has become one of the go-to agencies for mainstream celebrities looking to break into what was once a taboo subscription-based model.

Sadly, many of Unruly’s clients have found that the agency’s behavior can be unsavory, manipulative, and illegal. A recent Rolling Stone article details how Sarah Stage and Jessica Quezada are the latest models to take legal action against Unruly and its affiliate agency Behave. Sarah Stage, a fitness model with a massive following on Instagram, has accused Unruly of using high-pressure tactics to try to convince her to post nude photographs against her wishes. Along those same lines, Quezada has accused Unruly of posting sexually explicit captions on her OnlyFans photos, as well as sending highly inappropriate messages containing sexually explicit content to her OnlyFans subscribers.

As detailed by Rolling Stone, Steele and Quezada also alleged in court documents that Unruly made direct threats when they tried to leave the agency. In fact, this is a theme running throughout most of the lawsuits filed against Unruly: the marketing agency is accused of threatening models who asked to get out of their contracts. In at least one instance, Unruly reportedly continued to operate the model’s OnlyFans account even after the contract was terminated – until she finally gained access and changed her passwords.

Tauler Smith LLP Represents OnlyFans Models in Lawsuits Against Unruly Agency

The recent charges that Unruly posted sexual images of the popular influencers and fitness models without their consent is in line with similar allegations brought by other models and online content creators against the social media management company. This includes documented abuses like engaging in sexually exploitative behavior, pressuring models into illegal contracts, and threatening the models with financially crippling legal action.

In a case filed last year by Tauler Smith LLP on behalf of an OnlyFans model identified only as “Jane Doe,” the model alleged that Unruly Agency surreptitiously took nude photographs of her and then posted them on her OnlyFans account as “revenge porn” retaliation. Jane Doe also said that Unruly unlawfully took control of her personal bank accounts and finances. Another model accused Unruly of posting a sexually explicit video to her OnlyFans page without her consent, as well as threatening and intimidating her when she expressed a desire to leave the agency.

Both models are being represented in OnlyFans lawsuits by L.A. social media litigator Robert Tauler. Mr. Tauler did not mince words when describing Unruly as “basically pimps” who take advantage of young, vulnerable women looking to earn an income as OnlyFans creators and social media influencers.

Contact the Los Angeles Social Media Litigators at Tauler Smith LLP

The new allegations against Unruly Agency would be shocking if they weren’t so commonplace: this is just the latest entry in a long list of known abuses by the marketing agency. If you are a model, lifestyle influencer, or other type of social media influencer who has been exploited by Unruly, you should speak with an attorney immediately.

Tauler Smith LLP is a California law firm that has experience with social media litigation. We help models get out of bad contracts with abusive agencies, and we also help them get the compensation they deserve. Call us at 310-590-3927 or fill out the online contact form to explore your legal options.

Rolling Stone Article on Unruly Agency Exploitation

Rolling Stone Article on Exploitation by Unruly Agency

Rolling Stone Article on Unruly Agency Exploitation

As the subscription-based platform OnlyFans has exploded in popularity over the past few years, so too has a cottage industry of management companies and agencies. One of the most well-known companies, Unruly Agency, is now facing new lawsuits from two influencers who allege that Unruly pressured them into posting sexually exploitative content and threatened them when they tried to leave the agency. In two separate filings, model and lifestyle influencers Sarah Stage and Jessica Quezada are accusing Unruly Agency of trapping them into exploitative contracts and posting nude and sexual photos without their consent.

[…]

In 2021, the Daily Beast reported that a former client identified only as Jane Doe was suing the agency, alleging that it had posted an NSFW video of her to her public page without her permission and that they had threatened her with legal action when she tried to leave the company. “These guys are basically pimps,” Jane Doe’s attorney Robert Tauler told the Daily Beast.

Read the full article on the Rolling Stone website.

PPE Fraud Lawyer

Tauler Smith Obtains Judgment for Fraud Against PPE Scam After Federal Bench Trial

The California business fraud lawyers at Tauler Smith LLP recently helped a client obtain a judgment for fraud against a PPE scam. After a two-day bench trial, a U.S. District Court granted 100% of the compensatory damages sought by plaintiff Solmark International in the case.

PPE Fraud Lawyer

L.A. Law Firm Tauler Smith LLP Secures Victory for Client in PPE Fraud Case

 

On February 4, 2022, federal judge Hon. Stanley Blumenfeld, Jr. for the United States District Court for the Central District of California entered Judgment for Fraud on behalf of Tauler Smith client Solmark International against PPE scammers.

Solmark International is a major supplier of personal protective equipment to companies in the United States. The defendants in the case were PPE scammers who had engaged in a scheme to sell non-existent PPE (personal protective equipment) to national distributors like Solmark. The PPE fraud scheme began with the defendants falsely representing that they had acquired millions of masks to service Solmark International’s clients who were looking to return to work more safely during the COVID-19 pandemic. Once the defendants received a bank wire transfer for the PPE products, they effectively vanished. This resulted in a series of defaults from the defendants.

Solmark International then filed suit in 2020 with predecessor counsel, and the case was scheduled for trial in late-2021. Los Angeles law firm Tauler Smith LLP ultimately helped the plaintiff secure a favorable judgment and recover significant compensation.

Federal Court Issues Final Judgment in Favor of Solmark International

A final judgment was issued by United States District Judge Stanley Blumenfeld, Jr. on February 4, 2022. The specifics of the federal court’s ruling were as follows:

  • Compensatory Damages: The defendants were ordered to pay plaintiff Solmark International the sum of approximately $100,000.
  • Counterclaims Dismissed: The defendants’ counterclaims against Solmark International were dismissed.

Attorney Robert Tauler Fights for Victims of Business Fraud in California

“I am very pleased our team was able to obtain a fraud judgment against dishonest people who thought only about themselves at the expense of others during such a sensitive time in our history,” said L.A. business fraud attorney Robert Tauler. “I am fortunate to have clients like Solmark International that believe justice is worth fighting for.”

Tauler Smith LLP is a law firm with a history of success in California business fraud cases. Our experienced litigators have successfully represented clients in business disputes and fraud matters in both local California courts and federal courts. We understand the nuances of this complicated area of the law, and we have the institutional expertise needed to guide you through the legal system and get you the compensation you deserve.

Contact the Los Angeles Business Fraud Lawyers at Tauler Smith LLP

If you were a victim of business fraud, corporate fraud, or consumer fraud, the litigators at Tauler Smith LLP can help you. Call 310-590-3927 or fill out the online contact form to schedule a free consultation.